There has not been a lot of recent enforcement activity from the CFPB in terms of its loan originator compensation rule, but industry participants shouldn’t get complacent, according to some top compliance professionals. “We’ve seen the bureau say a couple different times that this is going to be a priority, and they’ve put out a few bulletins on this rule. But we’ve seen very little enforcement activity in this space,” said Maria Earley, a partner with the Reed Smith law firm in Washington, DC, during a panel discussion at the American Bankers Association’s 2017 regulatory compliance conference, held last month in Orlando.That being said, compliance professionals must not let their guard down. “Document everything. Step through with the regulators ...
An effort by a handful of state attorneys general to intervene in an enforcement action brought by the CFPB against Sprint Corp. back in 2014 and lay claim to the unspent settlement funds will likely come to naught, after the U.S. District Court for the Southern District of New York blocked the effort. In its enforcement action, brought in December 2014, the CFPB accused Sprint of billing wireless customers tens of millions of dollars in unauthorized third-party charges from 2004 to 2013. The issue here involved charges for what are known as “premium text messages” or “premium short messaging services” because they are frequently delivered by text messages. Examples of such products and services include ringtones, wallpaper images, and text ...
Joint Trade Letter Requests Comment Extension on Language Access. Eight trade groups, including the American Bankers Association and Mortgage Bankers Association, wrote the Federal Housing Finance Agency this week asking for a 45-day extension to comment on FHFA’s Request for Input on Improving Language Access in Mortgage Lending and Servicing. “The RFI reflects the breadth and difficulties of this issue, as it asks for extensive information,” the groups said, adding that the deadline also coincides with other RFIs. Fannie Announces Two CIRTs on $19.8 Billion of Single-Family Loans. Fannie Mae announced this week that it has completed the second set of traditional Credit Insurance Risk Transfer transactions of...
The Federal Housing Finance Agency’s recommendation that it gain authority to oversee nonbanks didn’t go over too well with some in the mortgage industry. The GSE regulator argued that oversight of nonbank mortgage servicers only happens via contractual provisions when possible. In the FHFA’s Annual Report to Congress, it said other federal safety and soundness regulators are allowed statutory authority to examine companies that provide services to depository institutions. David Stevens, the Mortgage Bankers Association’s president and CEO, questions the purpose of the FHFA recommendation and said it would only lead to more unnecessary regulation.
California remained the top state for Fannie Mae and Freddie Mac activity in the first three months of 2017 as volume reached $42.92 billion, according to a new Inside The GSEs analysis. And that’s higher than the $36.18 billion in volume the Golden State had in the first quarter of 2016. Texas trailed in second place with $14.22 billion in volume, up from the $12.43 billion in volume a year earlier. Rounding out the top five for GSE volume were Florida ($12.14 billion), Colorado ($8.62 billion) and New York, ($8.32 billion.) Also in California, the average Fannie and Freddie loan was $311,992 in the first quarter, an increase from the average loan size of $307,302 in the first quarter of 2016.
Congress has GSE reform on the radar and even before this week’s hearing on GSE reform, Sen. Mark Warner, D-VA, said he was optimistic that housing finance reform might happen sooner than many expect. Warner, who co-authored a reform bill four years ago, recently said, “This may surprise some folks, but I think the stars may align where you could actually see housing-finance reform happen in front of some of the Dodd-Frank reform.” The Virginia senator made the comments at a Mortgage Bankers Association conference in Washington, DC, on June 20. He said there appears to be bipartisan consensus on housing finance reform.
Mortgage-banking activity slowed significantly at commercial banks and savings institutions in the first quarter, according to a new Inside Mortgage Trends analysis. Banks reported a total of $71.99 billion in retail 1-4 family originations in their mortgage-banking operations during the first three months of 2017, down 40.1 percent from the fourth quarter of last year. Loan sales volume also fell off sharply, dropping 29.1 percent to $163.75 billion during ... [Includes one data chart]
Federal Reserve Vice Chair Stanley Fischer said that government involvement in securitization weakened the link between the mortgage loan and the lender. He also warned that another global housing crisis could be looming. During a speech at the FNB-Riksbank Macroprudential Conference in Amsterdam, he acknowledged that Fannie Mae and Freddie Mac MBS helped to expand mortgage credit availability, but added that the rapid rise in credit access coupled with rising house prices can threaten the financial system’s resilience. “One particularly problematic policy is government guarantees of mortgage-related assets,” said Fischer. He mentioned the period leading up to the financial crisis when investors viewed agency MBS as having an implicit government guarantee, “despite the GSEs’ representations to the contrary.”
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